PEPS: Pick up a plan down the line

If you've done some research, you can cut costs by buying direct, writes David Burrows

PEP managers are surpassing themselves in their bids to encourage sales before the 5 April deadline. M&G is even setting up special centres, sending its staff to Holiday Inns around the country on Easter weekend to receive application forms up to the last minute.

If you know which fund manager and which fund you want to invest in, you can pick up the phone or get on the internet to buy without fuss.

If you aren't sure what to buy, you may want to see an independent financial adviser. The advantage of using an IFA is that he or she should be able to highlight the PEP that best suits your requirements.

The downside is that you have to pay for the advice, although many people don't realise it; the payments are taken out of your lump-sum PEP cheque. You can put up to pounds 6,000 into a general PEP, and from next month you will be able to put pounds 7,000 into a new Maxi ISA, which is basically a PEP by another name.

Many people don't want to see an IFA and may feel inclined to buy direct over the phone from the big players such as M&G, Fidelity and Perpetual. These firms do have special offers that cut down the initial charges, but because they depend on IFAs for a lot of their business they can't be seen to seriously undercut the service the advisers are offering.

So instead the managers do bulk deals (which they often don't publicise) with discount broking firms. These companies shift millions of pounds' worth of personal equity plans to those "in the know" and undercut everyone else when it comes to cutting the initial charges, which can be as high as 6 per cent if you go to an IFA or the PEP manager.

With a little homework you you should be able to choose a PEP to suit your own risk profile and income/capital requirements, and then buy it from a discounter.

The internet is great for would-be PEP investors in a hurry. As a recent PEP purchaser I found it helpful in giving me some idea of what was out there in the market.

Most sites are free and easy to follow. I recommend www., which gives up-to-date PEP performance statistics, quotations, names of discount brokers and full details of all providers, including the direct operations.

Interactive Investor is another useful site, at The site is well signposted, showing fund performance in its PEP Centre. It also offers a "find an IFA" service if you are looking for advice. Allenbridge, a discount PEP broker, has an excellent website at

If you don't have internet access, the discount brokers will send you lots of useful graphs and guides. There are also plenty of reference posts to point you in the right direction. Chase de Vere publishes a PEP guide (pounds 12.95) which is very useful (credit card hotline, 0800 526092; free PEP advice line, 0800 526091).

If you are really bold, you can actually buy your 11th-hour PEP over the net. The one provider that only trades over the web is NetPep ( There is no advice given but you do get the benefit of low charges and fast set-up of your plan.

Major providers such as Fidelity also offer PEPs over the net but you won't save money this way.

A final word of warning: don't feel under pressure to buy the personal equity plans on offer at your bank.

The high-street banks can only sell their own products and the quality varies. Compare what's on offer to what you see in the market. And you won't save cash by buying from the bank.

For those more inclined to follow the tracker fund route, there is a strong argument for buying from the execution-only PEP players such as Virgin Direct.

Some discounters give a small incentive on Legal & General's tracker fund (Chelsea Financial Services is one).

You should approach both managers and discounters about investment trust personal equity plans (see facing page for more on this cheap and effective choice).

n Discounters: Chelsea, 0171-351 6022; PEP Direct, 0800 413186; Elson, 0800 096 1111; Hargreaves Landsdown, 0117 980 9930.

Life and Style
food + drink
Arts and Entertainment
musicBand's first new record for 20 years has some tough acts to follow
Life and Style
Shoppers in Covent Garden, London, celebrate after they were the first to buy the iPhone 6, released yesterday
Liam Payne has attacked the media for reporting his tweet of support to Willie Robertson and the subsequent backlash from fans
peopleBut One Direction star insists he is not homophobic
Life and Style
healthFor Pure-O OCD sufferers this is a reality they live in
Arts and Entertainment
A bit rich: Maggie Smith in Downton Abbey
tvSeries 5 opening episode attracts lowest ratings since drama began
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Quantitative Risk Manager

Up to £80000: Saxton Leigh: My client, a large commodities broker, is looking ...

COO / Chief Operating Officer

£80 - 100k + Bonus: Guru Careers: A COO / Chief Operating Officer is needed to...

Senior BA - Motor and Home Insurance

£400 - £450 Per Day: Clearwater People Solutions Ltd: **URGENT CONTRACT ROLE**...

Market Risk & Control Manager

Up to £100k or £450p/d: Saxton Leigh: My client is a leading commodities tradi...

Day In a Page

A roller-coaster tale from the 'voice of a generation'

Not That Kind of Girl:

A roller-coaster tale from 'voice of a generation' Lena Dunham
London is not bedlam or a cradle of vice. In fact it, as much as anywhere, deserves independence

London is not bedlam or a cradle of vice

In fact it, as much as anywhere, deserves independence
Vivienne Westwood 'didn’t want' relationship with Malcolm McLaren

Vivienne Westwood 'didn’t want' relationship with McLaren

Designer 'felt pressured' into going out with Sex Pistols manager
Jourdan Dunn: Model mother

Model mother

Jordan Dunn became one of the best-paid models in the world
Apple still coolest brand – despite U2 PR disaster

Apple still the coolest brand

Despite PR disaster of free U2 album
Scottish referendum: The Yes vote was the love that dared speak its name, but it was not to be

Despite the result, this is the end of the status quo

Boyd Tonkin on the fall-out from the Scottish referendum
Manolo Blahnik: The high priest of heels talks flats, Englishness, and why he loves Mary Beard

Manolo Blahnik: Flats, Englishness, and Mary Beard

The shoe designer who has been dubbed 'the patron saint of the stiletto'
The Beatles biographer reveals exclusive original manuscripts of some of the best pop songs ever written

Scrambled eggs and LSD

Behind The Beatles' lyrics - thanks to Hunter Davis's original manuscript copies
'Normcore' fashion: Blending in is the new standing out in latest catwalk non-trend

'Normcore': Blending in is the new standing out

Just when fashion was in grave danger of running out of trends, it only went and invented the non-trend. Rebecca Gonsalves investigates
Dance’s new leading ladies fight back: How female vocalists are now writing their own hits

New leading ladies of dance fight back

How female vocalists are now writing their own hits
Mystery of the Ground Zero wedding photo

A shot in the dark

Mystery of the wedding photo from Ground Zero
His life, the universe and everything

His life, the universe and everything

New biography sheds light on comic genius of Douglas Adams
Save us from small screen superheroes

Save us from small screen superheroes

Shows like Agents of S.H.I.E.L.D are little more than marketing tools
Reach for the skies

Reach for the skies

From pools to football pitches, rooftop living is looking up
These are the 12 best hotel spas in the UK

12 best hotel spas in the UK

Some hotels go all out on facilities; others stand out for the sheer quality of treatments